AGENCYBANKING SERVICES AND CUSTOMER SATISFACTION IN DODOMA MUNICIPALITY

Abstract

Despite the growing trend of commercial banks to adopt the agency banking model as a cost-reduction strategy, little attention is paid to customer satisfaction. This dissertation aimed to assess the influence of agency banking services on customer satisfaction in Dodoma Municipality, Tanzania. Specifically, the dissertation examined the perceived level of customer satisfaction with agency banking services, it examined the effect of agencybankingservices’conveniences and responsiveness on customersatisfaction.Using a cross-sectional survey design, the study adopts the Expectancy Disconfirmation Model (EDM) and Service Quality Model (SERVIQUAL)as theoretical underpinnings and uses a self-administered questionnaire indata collection from 390commercial bank customers in Dodoma Municipality.Data were analyzed using descriptive statistics and the Multiple Linear Regression (MLR)Model. The study discovered that 54.8% of the customers were satisfied with agent banking services.Moreover, the findings show that the convenience of agency banking servicessignificantly influences customer satisfaction (p<.001).Specifically, the convenience of bank agent services explained 55.4% of the variance in customer satisfaction. About 78.8% of commercial bank customers spend less than 20 minutes to reach bank agent services and the bank agent offices are conveniently located.Lastly, the findings reveal that the responsiveness of agency banking services had significant influenceson customer satisfaction (p< .001). The responsiveness of bank agent services explained 53.7% of the variability in customer satisfaction.The dissertation concludes that commercial banks should continually invest in improving factors that enhance customer satisfaction to improve commercial bank performance and improve the well being of the community.The dissertation suggests some policy and practical implications for improving agency banking services in Dodoma Municipality.